Second Life, Linden Lab’s user-crafted 3-D online virtual world, is booming with consumers, but businesses are also going “in-world,” creating a bustling marketplace for third-party developers to handle this outsourced business and, for the most part, leaving internal IT staff out of the loop.

Chris Lassonde, president of Millions of Us, a company that helps businesses bring their brands into virtual worlds, said that Second Life really took off in mid-2006, spurred by a Business Week article which led to a jump from 2003’s original 2,000 subscribers to the 3.7 million subscribers signed up today.

There are 31,000 consumers logged on at any one time, with an average age of 35.

Businesses are using Second Life for two purposes, said Paul Jackson, a principal analyst with Cambridge, Mass.-based Forrester Research: business-to-consumer and business-to-business. The latter involves companies using Second Life to hold meetings, train, do simulations and do shared product generation, while the marketing and PR side of the business drive the former.

One of the challenges in creating enterprise-driven in-world content is tailoring a business message to the medium. “Second Life is user-narrative-driven, so you can’t just put up a billboard. People will just ignore it — you really have to create content that will get your story across by creating customizable content they can engage with for hours,” said Lassonde. “There’s no out-of-the-box solution right now.”

For example, Millions of Us took its client’s Toyota Scion model and set it up so that Second Life users could customize their cars. It also held a product launch for Intel’s Core 2 Duo processor, where someone sat in a window for three days in downtown Manhattan and recreated the city block around her in Second Life. It has also held in-world press conferences for Sun Microsystems, and crafted an in-world headquarters for CNET. Other examples are cropping up — American Apparel has an in-world clothing store where buying virtual clothes can earn the user real-life coupons, and Sweden recently established the first diplomatic representation in Second Life.

Belleville, Ont.’s Loyalist College is now teaching the country’s first in-world community college course, an example of the growing popularity of businesses using Second Life to gather together people from remote locations for meeting and collaborative purposes. “Internally, it can also breach geographical barriers,” said Francoise LeGoues, IBM’s vice-president and CTO of the distribution sector.

Among the big names in the tech industry, IBM is probably the biggest Second Life third party developer — it was the vendor of choice for Sears and Circuit City, which called on IBM to make in-world lounges for their products that allowed consumers to see how they looked in a 3-D environment. IBM was turned on to Second Life when it was a popular topic at its Innovation Jam. “I’ve been here a long time and seen a lot of technologies, but I’ve never seen an explosion of interest like this,” LeGoues said. IBM employees went in-world and started fiddling about, which has progressed to IBM’s spinning a unit out of its research division to cover 3-D Internet.

Lassonde said that Second Life presence management may shift internally, but during this exploratory time it will likely be outsourced. “It’s very new and people don’t know how to handle it,” said LeGoues. She compared it to the Web site a decade ago — some companies had their IT staff tinker from within, but most outsourced to boutique firms at first.